What this calculator tells you
Most people pick a life insurance amount by feel: a round number like $500,000 that sounds safe. This calculator replaces the guess with a short list of real costs. It estimates the extra cover your household would need if your income stopped tomorrow, based on your own income, debts, mortgage, children and existing protection.
The answer is a gap, not a verdict. If the result says $0, your current cover and savings already match your stated goals. If it shows a large number, you now have a concrete target to take to insurers when you request quotes.
The formula behind the result
The tool uses the needs-based method many planners prefer:
Extra cover = (income x years of support) + other debts + mortgage + (children x college cost) + $15,000 final expenses - existing cover - usable savings
The $15,000 allowance covers a funeral, last medical bills and estate paperwork. If you expect higher or lower costs, adjust the debt field to compensate. You can compare that line item with the figure from our Funeral Cost Calculator.
How to fill in each field
- Annual income: use gross pay, because that is the figure your family would actually lose.
- Years to replace income: count from today to the point your youngest child is independent, or to your planned retirement, whichever fits your situation.
- Other debts and mortgage: enter current balances, not original loan sizes.
- Children and college cost: enter how many dependants you have and a realistic per-child education budget.
- Existing cover and savings: include employer life insurance only if you would keep it after changing jobs.
Worked example
Maria is 36 and earns $75,000. She wants ten years of income replaced ($750,000), owes $15,000 on cards and a car, has a $200,000 mortgage, and plans $80,000 of education for each of two children ($160,000). With final expenses of $15,000 her total need is $1,140,000. She already has $100,000 of work cover and $30,000 of savings, so her gap is $1,010,000, roughly 13.5 times her income.
When the result may be too high or too low
The estimate ignores investment growth on the payout, taxes and government survivor benefits. A spouse with a strong income can reduce the real need; a family that wants to leave an inheritance or support a parent can increase it. If your result feels extreme, test it by changing one field at a time and watching which input moves the number most. It is usually the mortgage or the years of support.
What to do with your number
Once you have a target, check what it would cost with the Life Insurance Premium Estimator, then decide between policy types using the Term vs Whole Life Insurance Calculator. Our guide on how much life insurance you really need explains the DIME method and income multiples in more depth. Revisit the calculation after any marriage, birth, home purchase or career change.
Frequently asked questions
Is 10 times my income enough?
It works for some households, but families with a large mortgage, several children or a single earner often need 12 to 15 times income. Run the numbers instead of relying on a multiple.
Should I subtract my savings?
Yes, but only liquid savings your family could spend without hardship. Retirement accounts that carry penalties are better left out.
Does this include a stay-at-home parent?
You can model it by entering the yearly cost of childcare and household help as the income figure.
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Edited and checked by Talha Shah. Last reviewed 2026-10-17.